Millennials are the generation that seems to rely on rented housing options for longer, but interestingly, the reasons aren’t purely economic. Some millennials actually prefer renting to buying (some even prefer living at home) and developers are trying to keep up the pace by creating communities of single-family rental homes, to meet this demand.
Let’s explore the reasons behind this increase in renting trend with young professionals, as well as ways to attract them to your property.
The allure of urban areas
The latest urban revival in large American cities like Atlanta, Chicago, New York, Los Angeles, and San Francisco has attracted young people in major cities by droves. Allured by exciting nightlife, world-class restaurants, and the convenience of public transportation, millennials are leaving suburbs and choosing cities as their natural environment.
However, in large cities, homes are rarely sold, and even when they are, their price beats the budget of many third world countries. In trendy urban areas, renting is often the only feasible options, despite the high rents.
Children coming late
In the previous decades, purchasing a home was a rite of passage from the young age to adulthood. As you got married, bought a house, it was expected that you’ll fill it with little ones in due time.
However, these days, millennials are delaying that stage of life. A 2016 study has revealed that 23% of millennials still live with their parents. Being slower to make the transition from getting married to having children, Generation Y is also slower to purchase homes.
Problems securing mortgage
In the years preceding the Great Recessions, it was relatively easy even for individuals from high-risk groups to secure a mortgage. However, in the twilight of this recession, foreclosures have increased at yet unseen rates, so qualifications for obtaining a mortgage intensified.
High student loan debts and working through college, typically characterized by an unfavorable income-to-debt ratio, and less than satisfactory job market make it impossible for many individuals to meet qualifications and requirements set forth by mortgage lenders.
More flexibility in renting
When you buy a home, you’re literally stuck at that lot, at least for five years, which is the minimum experts suggest to live in a home if you don’t want to lose money. Renting, on the other hand, means you can fold up and go whenever you wish, as long as it doesn’t violate your lease agreement. All the repairs, yard work, and upgrades fall on the homeowner. It’s an age-old debate: rent vs. buy.
As a renter, your only worry is to have rent money ready at the start of the month. Whether a pipe bursts in the middle of the night or the garage becomes infested with termites while you are on holiday, the landlord will send someone to deal with it.
While standard amenities like fitness facilities and a pool were once considered popular bonuses for attracting renters, millennials seem to be more interested in practical perks like extra storage space, a patch of garden that can be cultivated for edibles, a useful driveway, and a detached garage or shed.
A sturdy corrugated metal shed or an American style barn such as those offered by Best Sheds, actually make a great investment to a rental property. With plenty of customization options, such a structure can become extra storage space, a cost-effective gaming room, a bicycle workshop, or even a home theatre.
Millennials are perhaps more environmentally conscious than any previous generation. Not only do they want to live sustainably, but they are concerned about the pollution, climate change, and irresponsible use of natural resources. As a result, they are more likely to consider energy-efficiency and low-impact rental houses and flats. In your renovations, use non-polluting products, such as low-VOC paint and advertise that you do.
If your rental unit is located near a farmer’s market or a community garden, make sure to put that in the listing, as well. Also, if the property you’re renting out is close to public transportation routes, millennials are likely to give it a higher score for both convenience and sustainability.
Welcome the pets
Historically, property owners, landlords, and homeowner’s associations have frowned on pets’ fur, teeth, claws, and accidents. However, it’s an undeniable fact that millennials love pets. Generation Y is represented by an impressive 35% on the pet ownership market. If you don’t allow pets, you’re eliminating a large portion of millennial renters, who will rather keep their fur babies and check out that place a couple of blocks away.
When making renovations and furnishing decisions, plan to allow pets in your rental property. Instead of carpets, consider hardwood or composite floors that better tolerate pet accidents.
Buying a house was once a milestone that millennials aren’t so interested in hitting today. High student loan debts, increased mortgage requirements, and delayed marriages, are just a few of the reasons why the young generation of professionals would rather rent a smart city flat or a small well-positioned house than sign up for a suburban home with a white picket fence.